§14 TzBfG — Fixed-term Employment ContractsTzBfG14#
Regulates when and how employment contracts may be time-limited.
§14 TzBfG (Part-Time and Fixed-Term Employment Act) permits fixed-term contracts only with a substantive reason (e.g. substitution, project, probation) or without reason for max. 2 years (max. 3 extensions). Previous employment with the same employer generally excludes reason-free fixed terms. For multi-employer engagements: fixed-term secondary employment is possible but requires clean documentation of the substantive reason.
§3 ArbZG — Working Time Act (Maximum Hours)ArbZG3#
Max. 8h daily work (exceptionally 10h) — decisive for multi-employment scenarios.
§3 of the German Working Time Act (ArbZG) limits daily working time to 8 hours. Extension to 10 hours is permitted if a 6-month average of 8 hours per working day is not exceeded. Critical for multi-employer scenarios: hours from all employers are aggregated. A talent with 32h primary job and 20h secondary job exceeds the legal limit — violation is an administrative offense with fines up to 15,000 EUR (§22 ArbZG).
§611a BGB — Legal Definition of Employment ContractBGB611a#
Legal definition of employment contract (since 2017) — basis for bogus self-employment delimitation.
§611a BGB has codified the legal definition of an employment contract since April 1, 2017: An employee is anyone obliged by the employment contract to perform instruction-bound, externally-determined work in personal dependence. The paragraph summarizes decades of Federal Labor Court case law. Important: The contract's label is irrelevant — actual circumstances are decisive. Thus directly relevant to all freelancer/work contract arrangements.
§99 BetrVG — Co-Determination for Individual Personnel MeasuresBetrVG99#
Works council must be involved before hiring, transfer or reclassification.
§99 BetrVG (Works Council Constitution Act) governs the works council's co-determination for individual personnel measures — particularly hirings, classifications and transfers in establishments with regularly more than 20 employees. The employer must inform the works council before the measure and obtain its consent. For external engagements (contractor, freelancer) consent is required for longer durations with organizational integration. Non-compliance: the measure may be reversed.
Bogus Self-EmploymentScheinselbstaendigkeit#
When freelancers effectively work like employees — triggering substantial social security back payments.
Bogus self-employment (Scheinselbständigkeit) occurs when someone is formally classified as self-employed/freelancer but actually works bound by instructions and integrated into the organization like an employee. Indicators: lack of entrepreneurial freedom, single client only, fixed working hours, no own hardware, instruction-bound. Legal consequences: Social security back payments (up to 4 years retroactive), payroll tax liability, in severe cases criminal proceedings for undeclared work (§266a StGB). Jowomo's free short orientation reflects the key details; the lawyer-reviewed assessment classifies them.
Data Processing Agreement (DPA)DPA#
Contract per Art. 28 GDPR governing data processing on behalf of the controller.
A Data Processing Agreement (DPA) is mandatory under Art. 28 GDPR whenever a company processes personal data through a service provider. It defines purpose, duration, type of processing, data subject rights, technical and organizational measures (TOMs), and liability. Relevant for freelancer engagements whenever the deployed person gets access to customer data.
Framework AgreementRahmenvertrag#
Umbrella contract defining conditions for recurring individual orders (call-offs).
A framework agreement regulates fundamental conditions (hourly rates, payment terms, liability, confidentiality, IP assignment) for a long-term business relationship. Specific engagements are then executed via individual 'call-offs' or 'Statement of Work' (SOW). Advantage: quick project starts without contract negotiation. Compliance risk: a framework agreement + regular call-offs + typical employee characteristics can indicate bogus self-employment.
General Data Protection Regulation (GDPR)DSGVO#
EU regulation protecting personal data — in force across all member states since 2018.
The GDPR (EU 2016/679) uniformly regulates the handling of personal data EU-wide. Core principles: lawfulness, purpose limitation, data minimization, transparency, storage limitation. Data subject rights: information, rectification, erasure, restriction, portability, objection. Obligations for businesses: processing records, TOMs, DPA with service providers, breach notification (72h). Fines up to 20 million EUR or 4% of annual revenue. How Jowomo processes personal data is described in our privacy policy (/privacy).
General Equal Treatment Act (AGG)AGG#
Protects against discrimination based on age, gender, origin, religion, disability, etc. in work life.
The AGG implements four EU anti-discrimination directives and prohibits disadvantage based on age, gender, ethnic origin, religion/worldview, disability, sexual identity. Applies to hiring, employment, termination, training. Employers are liable for AGG violations by managers.
GoBD — Principles of Orderly Digital Bookkeeping (Germany)GoBD#
Rules for digital bookkeeping and retention of tax-relevant data in Germany.
GoBD governs requirements for digital bookkeeping. Core principles: traceability, immutability, completeness, correctness, timely entries, order. Retention period: 10 years (invoices: §14 UStG). Invoices and time records must be GoBD-compliant, especially immutable after dispatch.
IP AssignmentIPAssignment#
Transfer of intellectual property rights (copyright, patents, designs) to the client.
An IP assignment clause stipulates that intellectual creations (code, design, inventions) produced during employment or an engagement are transferred to the employer/client. In Germany, for copyrights: individual rights can be transferred, but the moral right remains with the creator. For patents, the ArbnErfG governs compensation claims for employee inventors. Conflict risk in multi-employment: Who owns code that the talent uses both in primary work time AND secondary activity?
Minimum Wage Act (MiLoG)MiLoG#
Statutory minimum wage in Germany — since 2026: 13.90 EUR gross/hour.
The Minimum Wage Act (MiLoG) prescribes a Germany-wide minimum wage: 12.82 EUR (2025), 13.90 EUR (2026), 14.60 EUR (from 2027). Applies to nearly all dependent employees including marginal employees. Exceptions: trainees, certain long-term unemployed, interns (under conditions). Does not apply directly to freelancers/self-employed — but §17 MiLoG: clients are liable for the minimum wage of their subcontractors (prime contractor liability).
Non-Compete ClauseWettbewerbsverbot#
Contract clause restricting competing activities during or after employment.
During an existing employment, a statutory non-compete obligation applies (§60 HGB for commercial employees, analogously §241 BGB). Post-contractual non-compete clauses require written form, max. 2 years duration, and compensation of at least 50% of the last salary (§74 HGB). Critical for BYOE arrangements — the talent must check whether the planned secondary activity competes with the primary employer.
Non-Disclosure AgreementNDA#
Contractual obligation to treat certain information as confidential.
An NDA obligates contract parties not to disclose defined information to third parties. Standard practice before professional engagements begin. Note: Confidentiality obligations from an existing primary employment can conflict with new NDAs — hence it's a key question in the talent profile.
Service Contract (§611 BGB)Dienstvertrag#
Contract for services — what's owed is the activity itself, not a specific outcome.
Under a service contract (§611 BGB), the service provider owes the agreed activity as such — no concrete success. Examples: consulting, coaching, hourly-based freelance development. Delimitation from work contract is critical for bogus self-employment review: service contract + instruction-bound + integrated = employment contract suspicion. Fee typically flat-rate or time-based.
Status Determination Procedure (§7a SGB IV)Statusfeststellungsverfahren#
Official DRV procedure to determine whether a contractor is self-employed or socially-insured.
The status determination procedure under §7a SGB IV is the official procedure at the German Pension Insurance Fund (DRV) to clarify whether an employment relationship is subject to social security. Application by client OR contractor possible. Binding effect on SI providers. Duration: 3–6 months. Recommendation: In case of bogus self-employment suspicion, always apply prophylactically — saves later back payments. The procedure is free of charge.
Supply Chain Due Diligence Act (LkSG)LkSG#
Since 2023: due diligence obligations for companies to ensure human rights in the supply chain.
The LkSG obligates companies with more than 1,000 employees (since 2024) to ensure human rights and environmental standards throughout their entire supply chain. Obligations: risk analysis, preventive measures, complaint procedures, documentation. Fines up to 2% of annual revenue. Service providers/freelancers can also be part of the supply chain — particularly relevant for background checks and country risk flagging (AP-23).
Temporary Employment Act (AÜG)AUEG#
German law governing commercial employee leasing / temp work arrangements.
The AÜG regulates commercial employee leasing (temp work) in Germany. Any company 'lending' employees to another business requires a license from the Federal Employment Agency. Maximum leasing duration: 18 months with the same client. Equal pay after 9 months. Violations can result in undeclared-work accusations, back payments and substantial fines. Relevance for Jowomo: In practice, many freelancer engagements do not fall under the AÜG (genuine work or service contract). The delimitation must, however, be properly documented.
Whistleblower Protection Act (HinSchG)HinSchG#
Since 2023: protection for whistleblowers in companies with 50+ employees — internal reporting mandatory.
The HinSchG (implemented EU Whistleblower Directive) obligates companies with 50+ employees to establish internal reporting channels for notices of legal violations (corruption, antitrust, tax evasion, data protection, etc.). Prohibition of reprisals against whistleblowers. Confidential handling, feedback within 3 months. External reporting office at BfJ also available. For clients a compliance indicator: companies without functioning whistleblower systems have elevated compliance risk.
Work Contract (§631 BGB)Werkvertrag#
Contract for a specific deliverable — payment is due only upon acceptance.
A work contract (§631 BGB) owes a concrete, acceptance-ready deliverable (e.g. completed software, website, study). The contractor bears the success risk. A genuine work contract is exempt from AÜG requirements and bogus self-employment — caution: if no clear 'success' is definable (e.g. Scrum teams without acceptance), the tax office may reclassify the contract as a service contract.
Works Council (Betriebsrat)Betriebsrat#
Elected employee representation in establishments with 5+ eligible employees.
The works council is the statutory employee representation under the Works Constitution Act (BetrVG) in German establishments with 5+ permanent employees. Key co-determination rights: §87 BetrVG (social matters), §99 BetrVG (individual personnel measures incl. external engagements), §111 BetrVG (operational changes). When external talents are engaged for longer than ~4 weeks, works council consent is usually required.
